Craig Whyte completes takeover of Rangers for £1
Craig Whyte has completed his takeover of Rangers for £1 but amid continuing concerns by board members about his ability to invest sufficient funds.
The venture capitalist acquired Sir David Murray's 85.3% shareholding in the Scottish champions, replacing the 59-year-old as majority shareholder.
Approval by the Takeover Panel ended negotiations that began in November.
As Rangers issued a statement voicing their own doubts, Whyte expressed delight at a deal valued at £52.5m.
"As a keen Rangers supporter, I now look forward to helping the club secure its future as a leading force in Scottish and European football," said the 40-year-old Motherwell-born businessman.
"I know the club has gone through some difficult spells in recent times, but it is my commitment to the manager, his backroom team, the players and, most importantly, the loyal supporters that I will do all I can to ensure further success in the weeks, months and years to come."
Whyte arrived in Edinburgh on Thursday morning hoping to conclude the purchase of the shares from Murray, who paid £6m to take over the Glasgow club in 1988.
Now ownership has been transferred to Whyte via Wavetower, a newly-incorporated company formed for the purpose of acquiring the club from Murray International Holdings and which is 100% owned by Liberty Capital - itself ultimately owned by the London-based businessman.
MIH stresses that it was only willing to sell having gained assurances from Whyte about investment, including an immediate £5m injection for Ally McCoist, who will take over as manager and begin his team building in the summer, plus money to improve the state of Ibrox Stadium.
Rangers' independent board committee
“The IBC and Wavetower have differing views on the future revenue generation and cash requirements of the club and the IBC is concerned about a lack of clarity on how future cash requirements would be met”
A further £20m had been promised over four years as well as a guarantee to settle the club's debt with Lloyds Banking Group in a deal Murray thinks is good for the club.
At the outset of talks, it appeared that the former chairman would recoup around £4.5m from the takeover.
However, when a £2.8m tax bill was made public in Rangers' half-yearly accounts, the deal was renegotiated and he agreed that it would come from his share.
Murray waived the remainder of the sum due, with Whyte agreeing to invest that sum into the club.
"The guiding principle from the outset has been to get the right deal for Rangers," said Whyte.
"I know the time this has taken has created a lot of frustration, but it was vital we secured a deal that meant we could maximise investment in the team and that is what has been achieved.
"I would like to personally thank Sir David Murray for the way in which he has conducted his side of this difficult and complex negotiation as well for the devoted service he has given to Rangers over many years.
"His is a great legacy of which he can be proud."
In a statement to the Stock Exchange, Wavetower had pointed out that, by buying the controlling interest for £1, the Takeover Panel had given it dispensation from making a cash offer to all other shareholders of the club.
"Wavetower intends to post a circular to the club's shareholders by 16 May 2011 containing background information on Wavetower and other relevant information," it said.
However, the independent board committee - set up to examine the bid and consisting of chairman Alastair Johnston, chief executive Martin Bain, former chairman John McClelland, John Greig and Donald McIntyre - issued its own statement voicing concerns.
In particular, they are yet to be convinced about Whyte's ability to meet any financial sanctions imposed by HM Revenue and Customs over an outstanding tax investigation.
"In agreeing that no offer should be made to all shareholders, the IBC has insisted that the acquirer issues a document to all shareholders setting out the full terms of the transaction, comprehensive details on the acquirer and the sources of its funding and giving firm commitments to agreed future investment in the club," said the committee.
"In recent weeks, the IBC has been engaged with the acquirer and has secured an enhanced financial commitment from Wavetower for future investment into the club.
"The decision on the sale and purchase of the majority shareholding in the club firmly and ultimately rests between Murray MHL Limited and Lloyds Banking Group.
"Although the IBC has no power to block the transaction, following its enquiries, the IBC and Wavetower have differing views on the future revenue generation and cash requirements of the club and the IBC is concerned about a lack of clarity on how future cash requirements would be met, particularly any liability arising from the outstanding HMRC case."
Johnston had confirmed earlier this week that he will stand down as chairman on 16 May, while Michael McGill and Donald Muir have resigned immediately from the board.
Whyte has announced his first appointment to the board as Phil Betts, a 48-year-old businessman with expertise in refinancing and restructuring companies.